Japan PM adviser Hamada says dollar at Y120 acceptable
By Kaori Kaneko and Sumio Ito
TOKYO (Reuters) - The yen is fairly valued around current levels, a key economic adviser to Prime Minister Shinzo Abe said on Tuesday, a day after comments he made were taken to mean the yen was too weak.
Koichi Hamada, an emeritus professor of economics at Yale University, also told Reuters he was not suggesting the Bank of Japan ease policy at its next meeting this month, in contrast to the recent views of another Abe adviser.
"120 yen per dollar is acceptable," Hamada said in an interview.
He was quoted on Monday as saying a 105 yen rate was acceptable, but sought on Tuesday to clarify that he had been referring to the purchasing power parity-implied rate, which is around 101 yen, not the spot market rate.
"If the PPP-implied rate is at 105 yen and the yen weakens to 125 yen or to 130 yen, then such a gap may invite speculators," Hamada said.
The yen fell on the comments, giving up some of its gains on his previous remarks. The dollar rose to 120.10 yen from 119.70 yen on his comments to Reuters before slipping back below 120 yen.
On monetary policy, Hamada remained open to further easing, but did not see this as a pressing issue.
"I would not oppose further easing on April 30, because inflation won't be generated even if the central bank eases again," he said. "But I would not on my own oppose the BOJ adopting monetary easing for now." Continued...